Thank you for the answer! However it flew right over my head. The depreciation taken on the relinquished property lowers the cost basis of that property which in turn lowers the cost basis of the replacement property therefore it seems like double taxation if required to continue depreciating that property (method 1), or alternatively pay recapture tax if I elect to opt out of Reg 1.168(i)-6(i) ? Turbotax tells me to subtract depreciation from the cost basis. Does Turbotax not calculate all this automatically?
